GMC's new pickup focus: Luxury that's down to earth

Denali models, at prices that compete with Mercedes-Benz and Jaguar, account for about a third of GMC’s sales.

JACKSON HOLE, Wyo. — As GMC designed an off-road version of its Sierra pickup, customers said they wanted something different: boldness, capability and luxury — not flashy chrome.

From that effort came the Sierra AT4, an understated, matte-accented truck that's a departure from GMC's tried-and-true Denali formula.

"It was kind of like an 'aha! moment' for us," Carl Zipfel, a GMC truck designer, said last week at a media event here.

The customer feedback "really led to the way I describe AT4, and that's premium off-road," Zipfel said. "And it's something that really doesn't exist in the segment. If you look at our competitors, their off-road offerings make compromises everywhere."

Even among its pickup competition, GMC continues to focus on luxury buyers. It sees the trucks as "premium that's meant to be used," said Phil Brook, vice president of marketing for GMC and Buick.

The Sierra AT4, left, appeals to a new group of buyers and the MultiPro tailgate, above, has become a “game changer,” GMC says.

At prices that compete with Mercedes-Benz and Jaguar, Denali models make up about a third of GMC's sales. AT4, introduced on the Sierra light-duty trucks last year, makes up a significantly smaller share because it is still rolling out on the rest of GMC's lineup. Targeting the luxury end of the pickup market is key to GMC's success.

AT4 customers, who are on average eight years younger than typical Denali buyers, told the brand they didn't want a pickup that's lifted too high or that has bulky tires, but they wanted the capability those trucks offer, Brook said.

GMC listened and, in place of traditional chrome, gave the AT4 a matte smoke chrome finish called "Knight Rider."

"That gave this really neat look, something fresh and unique, and it was something they were after with the minimal chrome," Zipfel said.

The AT4 trim is available on the light- and heavy-duty Sierra and the 2020 Acadia. It will be available on the Yukon, Canyon and Terrain in the next 12 months, Brook said. It competes with the Ram Rebel TRX off-road concept and the Ford F-150 Raptor.

The average transaction price for the Sierra AT4 is $54,000, about $4,000 less than the average price of the Sierra Denali. The average transaction price on all models with the Denali trim is also $54,000.

So far this year, the average Denali price sits between industry leader Mercedes-Benz and Jaguar, said GM, citing J.D. Power PIN data. Brook expects Denali to surpass the German brand by year end.

The truck market is "a bimodal kind of a segment," said Brook. "There's good value at the end of the segment, which is where a lot of work trucks [are] and there's some good fleet business to be had. The midsection is a little bit softer, but then [there is] a lot of opportunity at the premium end of the market."

From 2015 to 2018, overall GMC sales were flat, according to the Automotive News Data Center. Sierra sales fell 2 percent during the same period.

The average household income is $154,000 for Denali customers and $138,000 for AT4 buyers, according to GMC.

In the last four years, sales of heavy-duty pickups over $60,000 across all brands have tripled, according to GM. "That's GMC's wheelhouse, and that's where we're going to focus," Brook said.

GMC’s AT4 targets the Ram Rebel TRX concept and Ford F-150 Raptor.

GMC expects to sell more than 150,000 Denalis this year. That volume, if achieved, would be a record for Denali. Denali's one-third share of all GMC sales is also a record high.

Tailgate flexibility

The MultiPro tailgate, which comes standard on the SLT, AT4 and Denali trims for the Sierra light- and heavy-duty trucks, has also become a "game changer," Brook said.

The MultiPro has an inner tailgate that can fold out and down into a step and has a load-stop feature to keep cargo in the bed when the tailgate is down. The inner tailgate can also be used as a table or work surface while the main tailgate is up.

"Sierra was on the map, but [the tailgate has] well and truly put it on the map," Brook said. "I travel all around the U.S., and whenever I say I work for GMC, one of the first things anyone says to me is, 'Oh, they've got the cool tailgate.' "

When customers experience the tailgate, they discover even more ways to use it, he added. "It's sort of taken on a bit of a life of its own."

The MultiPro tailgate is not available on Chevrolet trucks.

Premium focus

GMC shines in the premium end of the market, Brook said, but the brand can offer a broader price range with the 2020 Elevation. The Elevation trim was available on the light-duty double cab and has expanded to the crew cab, he said. More customers opt for the crew cab, so adding the Elevation trim will raise volume without increasing the price. The average transaction price for vehicles with the Elevation trim range from $42,000 to $47,600, depending on the configuration.

"What we want to do is make sure that we get our fair share across the board," Brook said, "but with a real skew, focus on premium."